Problem 1:
1. On December 3, Rebecca Company sold $48,000 of merchadise to Simonis Co.,2/10 ,n/30, FOB shipping point. The cost of the merchadise sold was $350,000.
2. On December 8, Simmons Co. was granted an allowance of $27,000 for merchadise purchased on December 3.
3. On December 13, Rebecca Company received the balance due from Simmons Co.
a. Prepare the journal entries to record these tranactions on the books of Rebecca Company using a precpetual inventory system.
b. Assume that Rebecca Company received the balance due from Simmons Co. on January 2 of the following year instead of December 13. Prepare the journal entry to record the recepit of payment on January 2.
Problem 2:
Assume that E. Guard Company uses a periodic inventory system and has these account balances: Purchase $400,000; Purchase Returns and Allowance $11,000; Purchase Discounts $8,000; and Freight-in $16,000. Determine net purchases and cost of goods purchased.